Portland-based commercial real-estate investment and management firm Felton Properties Inc. has acquired a six Milwaukee-area office buildings totaling 392,000 square feet in a $37.7 million portfolio deal, the company announced today.
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20935 and 20975 Swenson Drive, Waukesha. (Credit: Felton Properties Inc.)[/caption]
Three of the six buildings are in the Crossroads business park in the Town of Brookfield, at 20825, 20935 and 20975 Swenson Drive. The other three buildings are located in the Park Place office park, about 10 miles north of downtown Milwaukee, at 7800 N. 113th St., 11100 W. Liberty Drive and 11301 W. Lake Park Drive.
The portfolio deal marks the company's first acquisition in the state of Wisconsin, noted Matt Felton, president of Felton Properties.
"It fits with our model of acquiring well-located assets with intrinsic value where we have the ability to significantly increase property value through our hands-on approach to leasing and management," Felton said in a statement.
Felton described the portfolio as diversified with strong tenant rosters in a region that has shown sustained, steady growth with a young and educated workforce, as well as a strong livability index.
"This is exactly the type of investment and market that Felton Properties seeks to invest its capital and hold real estate for the long term," he said.
The Crossroads properties are multi-tenant suburban office buildings. Law firm von Briesen & Roper recently expanded its lease at 20975 Swenson Drive, while Novus Home Mortgage expanded its existing lease at 20935 Swenson Drive, Jeff Borlaug, Felton Properties' managing director, said in an email.
The Park Place properties, meanwhile, are single-tenant properties located in a submarket that Felton Properties says is much more suitable for accommodating back-office, high-density, larger floor-plated users. One of the Park Place buildings are occupied by Aurora Healthcare and the other by DentaQuest LLC, both with long-term leases in place. Concentrix leases the third Park Place building but does not currently occupy the space, Bourlag said.
“Our plan is to reposition the Crossroads assets by investing in new tenant amenities as well as upgrades to the common areas and physical building components to create a better overall tenant experience” said Bourlag. “In addition, we’re hopeful that the Park Place and Crossroads properties will continue to benefit from the lift occurring in the greater Milwaukee office market.”
The acquisition was brokered by Tom Shephard, partner of Colliers International | Wisconsin, who represented the sellers, Westport, Connecticut-based Greenfield Partners and Somerset Properties Inc. of Lower Gwynedd, Pennsylvania.
In 2017, Somerset and Greenfield listed for sale a portion of the Park Place office park
— eight buildings and two development sites. The three buildings sold to Felton Properties were among those up for sale.
Shepherd said he brought the opportunity directly to the buyers, who he said came highly recommended by his peers at Colliers.
"They came to Milwaukee and really fell in love with what it has to offer," he said.
Points that stuck out to the buyers, Shepherd said, include the downtown environment that includes the lakefront and Historic Third Ward. Also playing a role was the development activity that can be seen in the area, including major investments from companies such as Komatsu Mining Corp. and Foxconn Technology Group.
"They're long-term investors and they're excited to make a calculated investment in our region," said Shepherd.